1. Field of the Invention
The present invention relates generally to methods and apparatuses for processing sales. More particularly, the present invention relates to a method and apparatus for processing sales of multiple products at a single price based on sales performance data of the products.
2. Description of the Related Art
The retail industry often offers a group of products together at a single price. By way of example, fast food restaurants have been known to offer meals which include a hamburger, French fries and a soda at a single price which is less than the sum of the prices of the individual products. Alternatively, a product may be added, e.g., a complementary apple pie is provided with the purchase of a hamburger, French fries and a soda at their regular price. These meals are typically ordered from xe2x80x9corder-by-numberxe2x80x9d or xe2x80x9cpackage dealxe2x80x9d menus, thereby providing the customer a convenient way to order multiple products. Often these products are so related that they are commonly purchased during a single transaction, making them ideal candidates for a packaged type offering. Moreover, the customer is encouraged (in effect rewarded) to purchase more than the customer may have initially intended. For example, a customer that may have intended only to purchase the hamburger and soda may respond to the promotion by purchasing the packaged meal that also includes French fries for a slightly higher price.
Other retailers commonly offer a plurality of products, which may be the same or different but are typically closely related, at a single price. For example, a clothing store may offer any two sweaters at a single price which is lower than the sum of the prices of the two sweaters individually. Alternatively, an additional product such as a fourth pair of socks may be offered for free to those who purchase three pairs of socks. These methods are typically employed in a xe2x80x9cclearancexe2x80x9d sale, e.g., at the end of a season. Clearance sales are usually only implemented when demand levels fall below a certain threshold at which the retailer decides that a sale is necessary to sell the surplus inventory. Since such decisions are not continuously decided in proportion to demand patterns, retailers miss an opportunity to optimize decisions as to such sales. The consumer""s perceived value of the package allows the retailer to sell products that otherwise may not be sold. However, the purported value of a package offer may not be perceived accurately by consumers, since package pricing allows the retailer to disguise the price of the individual products in the package which may be discounted or inflated. Regardless, a customer is encouraged to purchase more than they may have initially intended.
Nevertheless, retailers are still faced with the problem of selling inventory that has become distressed. Retailers typically offer their distressed inventory at cost or even at a loss to make room for more profitable merchandise or to avoid a substantial loss in their investment. Inventory becomes distressed when the supply exceeds demand, such as when a product becomes unpopular at market. The risk of inventory becoming distressed increases with products that are perishable or that will expire. The closer products get to perishing or expiring, the less likely it becomes that the retailer will sell the product for a profit providing demand at least remains constant or diminishes. If the product expires before it is sold, the retailer will lose all revenue opportunities associated with that product.
Consequently, retailers frequently dispose of expired products they were unable to sell. By way of example, fast food restaurants generally throw out any prepared food that has not been sold by the time the restaurant closes. Also, unsold magazines and newspapers are disposed of when they expire.
In recent years, an economic theory known as xe2x80x9crevenue managementxe2x80x9d has been proposed to solve inventory related problems. The theory states that markets are most efficient when prices are dynamically adjusted in proportion to supply and demand. The practice of revenue management has proven to be highly successful in the airline industry. More specifically, airlines use revenue management principles to optimize their profits on perishable inventory by selling seats at prices that vary in accordance with supply and demand. Furthermore, the grandparent application to the present invention, U. S. patent application Ser. No. 08/947,798 entitled xe2x80x9cMethod and Apparatus for Dynamically Managing Vending Machine Inventory Prices,xe2x80x9d filed Oct. 10, 1997, employs such revenue management concepts in vending machines. However, a need clearly exists to solve inventory problems in retail environments.
An object of the present invention is to enable a retailer to offer groups of goods at discounted prices in accordance with dynamic measurements of supply and demand.
An advantage of the present invention is that by pairing low demand products with high demand products, a retailer can utilize the popularity of one product to sell another less popular product. Another advantage of the present invention is that by requiring consumers to purchase a package in order to be eligible for a discount, a retailer can substantially discount products without exposing its price floor.
According to the present invention, a method and apparatus are disclosed for offering a plurality of products. A package offering system identifies the product identifiers of products that are complementary, and verifies acceptable sales performance of the complementary products. The system identifies a package which includes the product identifiers of the complementary products having acceptable sales performance, and determines a package price for those products. A status of the package is set to invalid upon expiration of a time interval in which the package is available.
In accordance with the present invention, package offer redemption includes receiving a plurality of product identifiers that are indicative of a plurality of products. A package including the received product identifiers is identified and a package price for those products is determined. Then, a sale of the products is processed, and sales performance data are adjusted based on the sale of the products. The status of the package is set to invalid when the sales performance data for the products fail to meet established limits.